Apple agrees to pay $350 million in Italian tax case

Associated Press

Published
1:33 pm PST, Wednesday, December 30, 2015

ROME — Apple has agreed to pay Italy about $350 million in taxes for several past years, prosecutors said Wednesday, part of a broader European effort to make multinationals pay what they owe in each country where they do business.

Italy has already brought several cases against global technology companies that have headquarters in low-tax nations like Ireland to avoid paying higher taxes in other countries, like Italy. The practice, called profit-shifting, has come under attack from European Union executives, who want multinationals to pay tax where they earn their revenue, and not where they have their regional base.

The EU’s 28 states agreed in October to share details of tax deals they reach with big companies to make sure they are fair to other countries. The EU has already ordered Starbucks and Fiat to pay millions in back taxes to Luxembourg and the Netherlands, respectively.

Milan prosecutors confirmed a report in daily La Repubblica that Apple agreed to pay the sum for the years 2008-13. The prosecutors also said Apple’s tax liabilities for the five successive years will hinge on an international ruling on such cases. They declined to give details.

They also declined to discuss how payment of back taxes might affect a criminal probe, conducted by the prosecutors, into suspected tax evasion by three Apple employees. La Repubblica said two of the employees are executives based in Italy while the third is based in Ireland.

Apple CEO Tim Cook has repeatedly rejected the notion that his company is trying to dodge taxes. In an interview with CBS TV program “60 Minutes” aired Dec. 20, he said: “Apple pays every tax dollar we owe.”

Italian state television said the $350 million worked out in the agreement is far less than what Italian tax authorities contend should have been paid over those years.